Final answer:
The Soviet Union had a stagnant and inefficient command economy that struggled with the production costs for an increasing number of weapons, making the statement True.
Step-by-step explanation:
The statement regarding the Soviet economy being stagnated and inefficient is True. During the Soviet era, industrial production was controlled by the government's command economy, with no market incentives to drive innovation or efficiency. As a result, the Soviet Union faced significant economic challenges, especially in its later years, and struggled to keep up with the escalating costs of the arms race. The centralized planning resulted in a lack of incentivization for productivity and innovation, contributing to a stagnant economy and inefficiency. Furthermore, the collectivization of agriculture aimed to prevent the rise of wealthy, individual farmers but often led to poor agricultural outputs, exacerbating the economic hardships.